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Thursday, July 09, 2009

Jobs and healthcare

Time to join the fray again, I guess. I'm obsessed with the need for a well-targeted national health insurance program. Here is a comment I made on another site about the connection between real recovery in the job market and health insurance reform. None of the big progressive insurance pundit honchos seem to get how the game will be changed totally: for one thing, how massive administrative waste, will be swept out of the system once healthcare providers always -- always -- know they will be paid at least most of a large bill. We will also reduce national healthcare costs massively by collectively sharing the risks of exposure to very large claims. Sharing such risk through our government will take out of aggregate national cost the need to plan for (charge for) the worst case scenario that a single private insurer with an uncertain risk pool must do, and will remove the profit on that coverage of a for-profit private insurer.

Recovery in jobs will be retarded until fear of disastrous liability for healthcare costs on the part of individuals and employers is removed from the national equation, and until healthcare providers can massively reduce their worthless administrative costs by knowing at the outset of treatment they will be paid for their services and by whom. Until we achieve a decent healthcare plan successfully divorcing at minimum catastrophic health insurance from retention of a job, confidence in the economic future, the sine qua non of a thriving economy, will keep hitting an unsatisfactory ceiling as it did during the anemic Bush “recovery.”

This is the single most important point, the macro of macro effects. Yet even though virtually all Americans will get it once these simple dots are connected, Obama is failing to say it. I’m not sure he or his people get it, or even Bernie Sanders or the most progressive of the rest of Congress. This is not just about the unfairness of people being uninsured, but is fundamentally about removing the fear of potential disaster that haunts everyone, even those with an occupation that provides five-star insurance today.

This does not even get to the huge reduction in premiums for the remaining "gaps" that putting a cap on the insurance company's exposure will cause, and the hundreds of billions that will be freed up for other more productive purposes; or the stronger international competitive position of American companies freed from fear of huge and ever-escalating costs; or the ability for such companies facing smaller and more predictable benefits costs to begin hiring again, and hiring actual employees instead of quickly expendable temps.

Will Democrats ever see the forest instead of the trees.


Blogger boardshooter said...

To pick up on Kissweb's final point on the benefits to industry from a national HC plan, it is estimated by most economists that the unloading of catastrophic risks alone will cut the average cost of an automobile by $1500-$2000. That turns a loss into a profit given the razor thin margins US producers have been reduced to. It also enables profitable (vs. recent unprofitable) price cut options for automakers, thereby, increasing demand and turning profits over more volume. Most industries would experience similar benefits. Let's get on with it if we are serious about the economy.

11:12 PM  

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